A recent Law 360 story by Ryan Harroff, “Judge Axes Benicar Fee Suit. Says Firm Didn’t Overcharge” reports that Mazie Slater Katz & Freeman LLC beat a suit that claimed it overcharged its clients in multidistrict litigation over gastrointestinal injuries related to blood pressure drug Benicar and its generic Olmesartan after the New Jersey court found a state attorney fee rule did not apply to the MDL.  A New Jersey federal judge granted Mazie Slater's motion to dismiss the proposed class action, writing that the nearly $9 million award for the firm was "well within the reasonable and equitable percentages of Third Circuit examples."  The court agreed with the firm's argument from its dismissal bid that a state rule on attorney fees that served as the backbone of the action does not apply to mass tort MDL cases.

According to the court's opinion, named plaintiff Anthony Martino misapplied New Jersey Court Rule 1:21-7(i), which requires firms to aggregate class action fees based on individual client recoveries and seek court approval for fees over $3 million, by claiming that he and his proposed class members all had "substantially identical liability issues," a requirement for the rule, since they were all litigants in a New-Jersey resident-only multicounty consolidated litigation running parallel to the broader Benicar MDL.

According to the opinion, "there can be no rational, medical, logical, or legal justification why the claims of a subset of Olmesartan registrants could be interpreted as having substantially identical liability based merely on the fact they arose in the MCL."

The product liability MDL and MCL in question sought to hold Daiichi Sankyo Inc. and Forest Laboratories Inc. accountable for injuries suffered by Benicar and Olmesartan users.  The MDL settled initially for $300 million in August 2017 and the deal later grew to $380 million after triple the expected class members registered, according to the opinion.

Mazie Slater got $8.9 million of the total attorney fee allotment from the deal, and Martino accused the firm of running afoul of the New Jersey court rule in his November complaint, which claimed legal malpractice, unjust enrichment and conversion after firm partner Adam Slater allegedly failed to tell his clients that the firm would get "substantial fees and costs for the same, or substantially same, work that he had performed for each client and for which he received a full fee under the individual retainer agreements."

The rule does not apply to MCL or MDL consolidations, the court wrote, citing a lack of case law to support its application and the "very different and the very specific factual details" of each consolidated injury, which, according to the opinion, undercut Martino's argument the MCL litigants issues are substantially identical.

Bruce Nagel of Nagel Rice LLP, counsel for Martino and the proposed class, told Law360 that it is "nonsense" for the court to say the MCL plaintiffs do not all arise from the same liability issues since they all come from the same drug.  Nagel also said the MCL plaintiffs all had retainer agreements with Mazie Slater that included the New Jersey court rule and that he believed the Third Circuit would find that rule enforceable under those retainers.

Adam Slater of Mazie Slater Katz & Freeman LLC, who is both a named defendant and counsel for himself and the firm, told Law360 that the court's decision was "absolutely correct," and that there are many variances of liability issues in the consolidated cases, such as whether a plaintiff took the drug before or after a warning about potential side effects was added in 2013.  Slater said variances like that are why the New Jersey court rule does not apply for mass torts.

"What we did here is consistent with what every New Jersey lawyer litigating mass torts in the state and federal courts of New Jersey has been doing for over 40 years, calculating fees, and it's very clear that that rule does not apply in a mass tort setting like the Benicar case or the other mass tort cases that are routinely litigated in New Jersey," Slater said.

A recent Reuters story by David Thomas, “Ex-Client Wans $22 mln From Brown Rudnick, Saying Lawyers Overbilled” reports that an Austrian multinational construction company went on the offensive in a fee dispute with U.S. law firm Brown Rudnick, claiming the firm routinely overbilled it and demanding $22 million.  Brown Rudnick sued Christof Industries Global GmbH in September, alleging the industrial plant builder owed $8 million in attorney fees and interest from an international arbitration over a failed construction project.

But the law firm racked up more than $6 million in fees after promising in writing to not exceed a $2 million fee estimate, Christof alleged in its countersuit, filed in Boston federal court.  The law firm improperly overbilled, Christof alleged, saying one attorney billed more than $145,000 for 231 hours preparing to examine one witness.  The law firm billed more than 40 hours for assembling binders, the company said.

"In a number of time entries that verge on satire, Brown Rudnick attorneys even billed for drafting and corresponding about a proposal for their 'binder compilation strategy,'" Christof said in its suit.

The dispute stems from Brown Rudnick's work arbitrating a conflict arising from a Christof subsidiary's work as a contractor during the construction of a fiberboard production plant in South Carolina.  Christof said it signed an agreement with the firm so that its legal costs would not exceed $40,000 a month, plus a $200,000 retainer up front.  But it said Brown Rudnick billed more than $250,000, not including the retainer, just in its first month.

A panel awarded Christof more than $24.5 million in damages in the underlying arbitration, which was offset by about $20 million in advanced contract payments the company had received.  The final award was for $6.68 million.